MAYOR BOLLWAGE STATES GOVERNOR CHRISTIE BREAKS PROMISE OF NO NEW TAXES Urban Enterprise Zones under attack - Changes would result in new tax

Contact: Kelly Vence
Public Information Office
Urban Enterprise Zones under attack - Changes would result in new tax 
ELIZABETH, NJ— March 12, 2014- Mayor J. Christian Bollwage announced that Governor Chris Christie's proposed FY15 budget would raise taxes on businesses in Urban Enterprise Zones throughout New Jersey.  Language within this most recent budget, would require a 3.5% sales tax to be applied to all Urban Enterprise Zone (UEZ) business to business sales. Currently transactions conducted between Urban Enterprise Zone businesses are tax free; however this proposed change would impose a new sales tax, which would further burden businesses and could possibly be passed on to the consumer to offset this charge. 
"With rising costs, it is difficult enough to attract businesses to New Jersey. Imposing a new tax through the removal of this incentive not only discourages companies from doing business and locating here, but also potentially increases the burden on consumers," said Mayor J. Christian Bollwage. "The inclusion of this budget language would further impede Urban Enterprise Zones and economic growth throughout this State."
The UEZ program has been the lynchpin to the uphill battle of revitalizing distressed municipalities throughout New Jersey; however the Program has ceased to exist as New Jersey municipalities once knew it. Although the 3.5% reduced sales tax incentive remains in effect for consumers, financial support has been eliminated for Urban Enterprise Zones within State Budgets. 
From redefining the eligibility for projects to cutting administrative funding, the UEZ Program has been under attack since Governor Chris Christie took office. These actions posed numerous challenges for UEZ municipalities and adversely impacted their ability to advance improvements, expansions and services. In addition, it became increasingly more difficult to identify local resources in order to efficiently and effectively re-certify existing businesses, certify new businesses and attract potential businesses looking to relocate with UEZ benefits. Person to person guidance on UEZ procedures and assistance with community programs previously provided by Zone representatives, also became a casualty of cuts in many municipalities.  
Throughout the life of the Program, Governor Christie further halted the progress of UEZ projects by cancelling Urban Enterprise Zone Authority meetings and vetoing minutes; which are required in the project approval process. The Urban Enterprise Zone Mayors Commission, which Mayor Bollwage served as the Chairman, aggressively sought to work with the Governor's Office and Legislature to continue advancing the Program and local initiatives.  Testifying before the Assembly and Senate, the UEZ Mayors Commission vocally touted the benefits of the Program as well as supported the enforcement of discrepancies and violations within Zones.
With an increasing number of individuals seeking to enter and re-enter the workforce each month, funding mechanisms like the UEZ program have diminished. This has hindered the ability to create jobs, enhance the availability of services and spur economic development, all of which are essential to the success of New Jersey’s urban centers.
"Since funding has been cut to Urban Enterprise Zones municipalities, cities have had to utilize additional resources to support ongoing investments previously supported with UEZ dollars," said Carlos Torres, Councilman of the First Ward. "New Jersey should be making it more appealing for businesses to choose our State as their home, not giving them one more reason to choose somewhere else." 
The Urban Enterprise Zone Program has been the catalyst for billions of dollars in business investments throughout New Jersey. The Program creates and retains jobs, promotes smart growth and investments as well as provides tax relief through the financing of infrastructure, sanitation and public safety initiatives; which in many cases would not be fundable through sole municipal budgets. 
The Urban Enterprise Zone (UEZ) Program began in 1983. The Program was designed to generate employment opportunities in urban centers and provided (1) a reduced sales tax rate to consumers, (2) elimination of the state sales tax for certified businesses and (3) assistance to local, qualified merchants in the form of low-interest loans and grants.